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Purpose
This paper aims to disentangle the mechanism linking digital servitization and manufacturing firm performance. The contributions of the service networks and slack resources are analyzed.
Design/methodology/approach
Drawing on a survey of manufacturing firms that have implemented or are implementing digital service projects in China, this paper examines the mediation effect of service networks and the moderated mediation effect of slack resources to capture the role of service networks and slack resources in the relationship between digital servitization and manufacturing firm performance.
Findings
Both basic and advanced digital services can equally contribute to manufacturing firm performance. Service networks mediate the relationship between basic digital servitization and manufacturing firm performance. No moderated mediation effect of slack resources is found, but slack resources negatively moderate the effects of basic digital services on service networks and positively impact service networks.
Originality/value
The mediating mechanism of service networks in the relationship between digital servitization and manufacturing firm performance is theorized, and it is clarified that service networks mediate the association between basic digital services and manufacturing firm performance but not advanced digital services. Additionally, there is no significant difference in performance implications when manufacturing firms provide basic versus advanced digital services, answering the call for research on the various types of digital servitization. This paper also identifies firms’ slack resources as the boundary conditions under which basic digital services influence service networks and the positive impacts of slack resources on service networks, bridging the network literature, organizational slack literature and digitalization literature under the framework of service ecosystem research.
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Anna Fedyunina, Liudmila Ruzhanskaya, Nikolay Gorodnyi and Yuri Simachev
This paper aims to discuss the firm productivity premium for servitized firms. It discusses servitization across the product value chain and estimates the effects of the range and…
Abstract
Purpose
This paper aims to discuss the firm productivity premium for servitized firms. It discusses servitization across the product value chain and estimates the effects of the range and extent of servitization on productivity premium in manufacturing firms.
Design/methodology/approach
This paper develops a conceptual framework and tests the hypotheses on the effects of servitization on productivity premium using linear regression models with a sample of 20,837 Russian manufacturing firms gathered from the Ruslana Bureau van Dijk database and the Russian customs service.
Findings
Servitized firms exhibit higher total factor productivity and labor productivity. The labor productivity premium increases with the number of services offered. However, the impact of services on productivity varies along the product value chain: postmanufacturing and postsales services enhance productivity premium, while manufacturing and back-office services diminish them. The effect of establishment services remains ambiguous.
Practical implications
This paper offers an analytical framework for firms to assess their servitization strategies. These strategies should be gradual, focused on enhancing firm efficiency rather than being an end goal. Firms should initiate the process by introducing services at the postproduction and postsales stages of the product creation chain to achieve productivity premium.
Originality/value
The paper extends the evidence on firm-level productivity drivers and contributes to the servitization theory. A servitization strategy should be portfolio-based, considering both the potential gains and losses in productivity resulting from the implementation of specific services.
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Jiantao Zhu, Jun Zhang, Zhongshuang Jiang and Jinghua Li
Emerging markets face the developmental circumstances of a weak foundation in both manufacturing and services. Although servitization is viewed as an opportunity to realise…
Abstract
Purpose
Emerging markets face the developmental circumstances of a weak foundation in both manufacturing and services. Although servitization is viewed as an opportunity to realise industry transformation and upgrading, ways for emerging market firms to implement a high-level servitization strategy is still understudied. This study examines combinations of causal conditions for emerging market firms to implement a high level of servitization.
Design/methodology/approach
Anchored in the strategy tripod model, this study examines the configurations for implementing a high-level servitization strategy by using fuzzy-set qualitative comparative analysis (fsQCA) and data from the China Stock Market and Accounting Research Database (CSMAR).
Findings
The findings identify three kinds of configurations for achieving a high-level servitization strategy: market-cultivational servitization, competition-driven servitization and government-related servitization. Furthermore, the mechanisms for implementing a high-level servitization strategy differ within the regional marketization level and state-owned equity. Specifically, the improvement of the regional marketization level helps manufacturing firms realise a high level of servitization by strengthening service capacity, and state-owned equity helps firms gain distinctive legitimacy to integrate suppliers and providers into the servitization context.
Research limitations/implications
The proposed multilevel perspective frameworks enable manufacturing firms in emerging markets to achieve a high level of servitization strategy.
Originality/value
This paper explores the impact of institutional environment, industry conditions and firm-level microfoundations on servitization, therefore providing a reference framework for emerging market firms interested in implementing high-level servitization strategies.
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Khadijeh Momeni, Eija Vaittinen, Markus Jähi and Miia Martinsuo
Smart services have gained attention both among academics and practitioners, but manufacturing firms struggle in getting their new smart services extensively adopted by customers…
Abstract
Purpose
Smart services have gained attention both among academics and practitioners, but manufacturing firms struggle in getting their new smart services extensively adopted by customers, employees and distributors. The purpose of this paper is to identify and analyse the requirements of different actors and the interconnectedness between their requirements in introducing smart services.
Design/methodology/approach
An embedded single-case study was conducted with a manufacturing firm and its network, including its sales and service personnel, customers and external salespeople. Data were collected via 30 in-depth interviews.
Findings
The paper advances the multi-actor perspective by identifying the requirements of key actors for introducing smart services. These requirements were divided into eight categories: value of smart services, reliability of smart services, competence for smart services, data security and management, attitude towards services, reliance, knowledge of installed base of equipment and services and service reputation. The findings reveal the interconnectedness of different actors’ requirements for introducing new smart services and how discussion and relationships between actors affected their requirements.
Practical implications
The findings represent a comprehensive template of requirements, as well as mapping the interconnectedness of actors’ requirements, serving as a practical guideline for managers.
Originality/value
This study characterises the introduction of smart services as a multi-dimensional, interconnected effort by manufacturing firms and their networks. It shows that service introduction cannot be viewed as manufacturer’s development task or customers’ adoption decision only. Propositions are offered on how multiple actors’ viewpoints can be combined to achieve success in introducing smart services.
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Manpreet Kaur and Shivani Malhan
Purpose: Manufacturing has always been considered a backbone for economic growth. It has been considered an imperative sector in the growth of an economy. This study aims to trace…
Abstract
Purpose: Manufacturing has always been considered a backbone for economic growth. It has been considered an imperative sector in the growth of an economy. This study aims to trace the long-term relationship between gross domestic product (GDP) and manufacturing sector in the context of Indian economy.
Need for the study: According to research, the significance of the manufacturing sector is waning over time. This chapter studies the long-term relationship between the GDP, an indicator of growth, and the manufacturing sector. Over the last few decades, the contribution of manufacturing has been stagnant in the GDP of India.
Methodology: The decadal growth of various sectors in the GDP of India is studied using time series analysis. This study used the data released by the Ministry of Statistics and Programme Implementation (MOSPI) from 1950–1951 to 2013–2014. The long-term relationship between the sector of manufacturing and the GDP is examined through the augmented Dicky–Fuller (ADF) test and auto-regressive distributed lag (ARDL) models.
Findings: The findings suggest that in the Indian scenario, there is no relationship for an extended period between the GDP and the manufacturing sector, which calls for further policy implications.
Practical implications: India, while having the world’s fastest-growing economy, must continue to take steps to attain high growth rates and long-term sustainability by reducing obstacles to the expansion of the service sector in addition to manufacturing. Manufacturing-led services are to be boosted through policy interventions.
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José-María Sánchez-López, María Luz Martín-Peña, Eloísa Díaz-Garrido and Cristina García-Magro
Absorptive capacity, technological collaboration and servitization are analyzed to establish ways to overcome the balance between products and services in manufacturing companies…
Abstract
Purpose
Absorptive capacity, technological collaboration and servitization are analyzed to establish ways to overcome the balance between products and services in manufacturing companies. A fresh perspective is introduced by presenting a framework for innovation strategy, moving beyond product-based R&D.
Design/methodology/approach
The hypotheses are tested using data on Spanish firms in the high-tech chemical and pharmaceutical industries through ordinary least squares regression analysis. The sample consists of 112 manufacturing firms included in the Spanish Survey of Business Strategies.
Findings
The results show that absorptive capacity facilitates servitization and that technological collaboration moderates the relationship between absorptive capacity and servitization. The synergies between absorptive capacity and technological collaboration for servitization are recognized from the perspective of open innovation as a way of resolving the trade-off between products and services.
Research limitations/implications
Future research should introduce more sources of collaboration by broadening the value chain perspective. Other approaches to innovation may also be considered, including relationships to process innovation.
Practical implications
The results can provide meaningful guidance for companies to determine the key opportunities of servitization driven by absorptive capacity, and the best ways to leverage open innovation and collaboration strategies to exploit such approaches.
Originality/value
This research enriches theories on servitization, open innovation and innovative behavior. Open innovation strategy should be linked to greater servitization activity and should support an open service strategy. This approach is crucial for building innovation capabilities through technological collaboration.
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Hua Meng and Hannan Sadjady Naeeni
This study aims to explain why low social conduct in corporate social responsibility (SC-CSR), especially employee exploitation, has a stronger negative impact on consumer…
Abstract
Purpose
This study aims to explain why low social conduct in corporate social responsibility (SC-CSR), especially employee exploitation, has a stronger negative impact on consumer reactions for service firms than for manufacturing firms.
Design/methodology/approach
Five experiments compared consumer reactions to service and manufacturing firms with low SC-CSR. Study 1 used a choice-based conjoint design to examine the relative importance of various shared attributes when consumers chose services versus goods. Study 2 revealed that low SC-CSR led to more pronounced negative consumers reactions toward service firms. Studies 3A and 3B explained this difference through a serial mediation analysis. Study 4 ruled out an alternative explanation regarding the differentiated effects.
Findings
The results reveal that consumer reactions to employee exploitation in service firms are more negative compared to manufacturing firms. This is because consumers’ sense of presence (i.e. feeling of being there) is stronger in a service setting, leading to more intense empathetic emotions toward service employees.
Originality/value
This research contributes to the CSR literature by challenging the conventional notion that sweatshops are more problematic for manufacturing firms. By contrast, the results indicate a stronger negative effect on service firms. It contributes to the services marketing literature by conceptualizing a novel cognitive mechanism. Traditionally, consumers’ negative reactions are driven by anger. However, the authors show that empathetic feelings toward mistreated employees play a predominant role. While it is imperative for all firms to ensure fair treatment of their employees, the findings underscore the heightened significance of this aspect for service firms, given their susceptibility to more pronounced negative effects.
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An Thi Binh Duong, Uyen My Diep, Paulo Sampaio, Maria Carvalho, Hai Thanh Pham, Thu-Hang Hoang, Dung Quang Truong and Huy Quang Truong
This research aims to specialise in the investigation of risk management for service-oriented manufacturing supply chains via two stages, highlighting its differences from…
Abstract
Purpose
This research aims to specialise in the investigation of risk management for service-oriented manufacturing supply chains via two stages, highlighting its differences from manufacturing. The research article is commenced by executing an encyclopedic review of earlier research to ascertain the distinctive traits of service-oriented manufacturing supply chains and identify prevalent risks. Secondly, an empirical study in the construction field, amongst the industry hardest struck in the mist of the COVID-19 epidemic, is conducted to thoroughly inspect the resonant effect of these risks on service-oriented manufacturing supply chain performance.
Design/methodology/approach
In this study, to validate the resonant effect mechanism, a thorough assessment is undertaken by juxtaposing theoretical model to a newly constructed comparative model that encompasses the single effects of risks on supply chain performance.
Findings
63% variance of service-oriented manufacturing supply chain performance was showcased by the resonant effect model, compared with 46.3% in the comparative model. Moreover, each risk exerts a more glaringly significant impact on supply chain performance, asserting the mechanism of the resonant influence. Another noteworthy result involves the demand risk possessing a low effect on supply chain performance, thus emphasising the superiority of service-oriented manufacturing supply chains.
Research limitations/implications
Future research endeavours should hinge on the optimal “resonant” model explosion, thereby foreseeing and alleviating worst-case scenarios to guarantee the robustness and resilience of supply chain networks.
Practical implications
Indubitably, reducing the intensity of the resonant effect revolves around lowering the coefficient of “a,” thereby restricting/eliminating the link among risks. Therefore, the suggested resonant impact model might thus serve as “a road map”. In light of the aforementioned considerations, it is advisable that supply chain executives employ supply chain management tactics namely avoidance, prediction, and postponement, but only after meticulous consideration the costs and benefits of adopting such strategies.
Originality/value
The service-oriented manufacturing supply chain features and advantages have been analysed and explained throughout the article. The data gathered during the COVID-19 pandemic is a captivating and topical point of this paper.
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Xuejiao Zhang, Yu Yang and Jing Wang
This paper aims to develop a dynamic two-sided stable matching method based on preference information of the matching objects in uncertain environments, so as to solve the…
Abstract
Purpose
This paper aims to develop a dynamic two-sided stable matching method based on preference information of the matching objects in uncertain environments, so as to solve the matching problem of cloud manufacturing tasks and services with load balancing.
Design/methodology/approach
For dynamic two-sided matching, due to the complexity of social environment and the limitation of human cognition, hesitation and fuzziness always exist in the process of multi-criteria assessment. First, in order to obtain the accurate preference information of each matching object, uncertain linguistic variables, uncertain preference ordinal and incomplete complementary matrices are used to evaluate multi-criteria preference information. This process is undertaken by considering the probability of each possible matching pair. Second, the preference information at different times is integrated by using the time-series weight to obtain the comprehensive satisfaction degree matrices of the matching objects. Further, the load adjustment parameter is used to increase the satisfaction degree of the matching objects. Afterward, a dynamic two-sided stable matching optimization model is constructed by considering stable matching conditions. The model aims to maximize the satisfaction degree and minimizes the difference in the satisfaction degree of matching objects. The optimal stable matching results can be obtained by solving the optimization model. Finally, a numerical example and comparative analysis are presented to demonstrate the characteristics of the proposed method.
Findings
Uncertain linguistic variables, uncertain preference orders and incomplete complementary matrices are used to describe multi-criteria preference information of the matching objects in uncertain environments. A dynamic two-sided stable matching method is proposed, based on which a DTSMDM (dynamic two-sided matching decision-making) model of cloud manufacturing with load balancing can be constructed. The study proved that the authors can use the proposed method to obtain stable matching pairs and higher matching objective value through comparative analysis and the sensitivity analysis.
Originality/value
A new method for the two-sided matching decision-making problem of cloud manufacturing with load balancing is proposed in this paper, which allows the matching objects to elicit language evaluation under uncertain environment more flexibly to implement dynamic two-sided matching based on preference information at different times. This method is suitable for dealing with a variety of TSMDM (two-sided matching decision-making) problems.
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Somayya Madakam, Rajeev Kumar Revulagadda, Vinaytosh Mishra and Kaustav Kundu
One of the most hyped concepts in the manufacturing industry is ‘Industry 4.0’. The ‘Industry 4.0’ concept is grabbing the attention of every manufacturing industry across the…
Abstract
One of the most hyped concepts in the manufacturing industry is ‘Industry 4.0’. The ‘Industry 4.0’ concept is grabbing the attention of every manufacturing industry across the globe because of its immense applications. This phenomenon is an advanced version of Industry 3.0, combining manufacturing processes and the latest Internet of Things (IoT) technologies. The main advantage of this paradigm shift is efficiency and efficacy in the manufacturing process with the help of advanced automated technologies. The concept of ‘Industry 4.0’ is contemporary, so it falls under exploratory study. Therefore, the research methodology is thematic narration grounded on secondary data (online) analysis. In this light, this chapter aims to explain ‘Industry 4.0’ in terms of concepts, theories and models based on the Web of Science (WoS) database. The data include research manuscripts, book chapters, blogs, white papers, news items and proceedings. The study details the latest technologies behind the ‘Industry 4.0’ phenomenon, different business intelligence technologies and their practical implications in some manufacturing industries. This chapter mainly elaborates on Industry 4.0 frameworks designed by (1) PwC (2) IBM (3) Frost & Sullivan.
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